Are you wondering what are the principles of international marketing? We’re here to help.
Simply put, you market internationally when you apply marketing principles to meet and satisfy the various needs of people worldwide, outside of the company’s home company. The main goal of this principle is to conduct marketing processes in more than one geographical area.
Another name for international marketing is ‘global marketing.’
It means that the marketing mix (promotion, place, price, and product) is the global scenario. It is then customized according to the preferences of the different kinds of people who live in other countries.
One of the most crucial decisions that a company has to make in its lifetime is going international. You may want to take your company on a large scale for a larger market share, greater profits, and revenue. You might not want to go global to protect your vast market share in the domestic market.
Even major companies like Nike, Coca-Cola, Ford, and other business behemoths made many mistakes while expanding and marketing that cost thousands and thousands of dollars internationally. Here are some tips for you if you want to avoid that. You can follow and integrate ten major international marketing principles into your marketing strategy. These draw inspiration from marketing’s 7 Ps.
What Are The Principles Of International Marketing?
Pretty much everything you’re doing is so that the people like it. You have to sell your product/service to customers, i.e., the people. Marketing is literally getting people to like or need your product. Your target customer base and product marketing must go hand in hand. At the first stage of the marketing process, it is crucial to understand who you are marketing to. If you don’t, you’ll end up putting up a lot of money trying to sell the wrong product to the wrong customer.
One such example is Best Buy. It has not seen explosive success internationally, especially in Europe, despite being such a massive success in the United States. Even though their products are in demand overseas, their distribution could have been better. Therefore, it could not be successful in convincing customers to buy in Europe.
In Europe, most shops are smaller and quainter. Best Buy, on the other hand, is popular for its huge boxes and large buildings. When they came up with their American-style brick-and-mortar shops, many Europeans didn’t welcome them. They might have done better if they had opened up smaller shops that accommodated the European taste.
It is also essential to see whether or not your product has demand in the market in another country. If you think that what you are currently offering will not do well in the country you are eyeing, you might want to consider not selling in that country’s market. The other option is to change what you are offering so that you can provide what the local market demands.
One such example is that of McDonald’s. With over 34,000 chains across the globe, the fast-food chain is a prime example of expanding to other countries and offering exactly what the culture demands. In the United States, it started with the classic cheeseburger. The meat was beef. However, when they expanded to India, they changed the menu to better suit the Indian palate. The McAloo Tikki is now one of the most popular snacks in India.
They did the same thing in Japan, the Philippines, Korea, and all other countries they expanded to. They understood what the people eat, and according to the market research results, they became a success.
Prices are probably what matters to customers the most. You have to choose a pricing strategy that is premium or economic. This will define your placement in the market and what kind of people come to your store.
You might not be able to move around the price point too much if you already have competitors in the area. If another company offers the same service or product, your pricing will have to compete with them. It is very likely that your service is premium somewhere else if you have a premium product. If your product is more affordable and friendly on the pocket, it might cost the same as your new market.
It is pretty challenging to be both a premium and everyday product at the same time. You can’t be a premium product in Egypt and be a standard product in the United States. Very often, it might even affect your brand and pull you down reputation-wise.
For example, when Omega introduced itself in the Swiss market, they priced themselves at a more affordable rate. This is because they knew that Rolex was already famous as the premium watch company. They shifted their strategy from a luxury good to a more pocket-friendly brand. While they did sell many more watches in the short term, their reputation as a watch brand lost exclusivity. People outside Switzerland started to think of Omega as a brand that sells cheaper watches. Rolex, meanwhile, is still popular as the maker of the most premium watches in the whole world.
Some companies also try to sell their products or services in an entirely new country. They do so by creating a new and different brand from the competition. When expanding to another country, you also might want to consider this international marketing strategy of creating a ‘brand’ new brand.
You can look at Procter & Gamble as a great example of this marketing strategy. They have several different brands – some of them are more economically friendly while others belong to premium category. When they launched in Japan, they introduced themselves as an everyday household brand. Success followed quickly, and it soon became a well-known market leader.
But Procter & Gamble has the advantage of having a lot of hands in several different sectors. So, they have the resources to price a product at a lower point.
Similar to this example is Birkenstock. It offers expensive premium sandals and a more pocket-friendly option made from a less-expensive material called EVA foam. They did this to get customers from both spectrums, thus maximizing their customer base.
You must devise and formulate strategies that you know will do well in the environment you aim for. You have to figure out what marketing tool will best suit your business in a new market. It is not too different from formulating a strategy on your home turf.
Regardless of whether or not you live in the area, you will promote the product that you sell. It is essential to research to track the behaviors and trends of your target audience.
If you look at countries like Brazil, South Korea, and Russia, Facebook is not as popular as Twitter or other regional apps and networks. So, while you might want to advertise on Facebook in countries like India or the United States, where it is the most popular, advertising on Twitter might prove a lot more effective in the other few countries.
This doesn’t mean that you should stop advertising on Facebook completely. This information implies that focusing a little more on the other sites could be more effective, depending on how you do it. It is also a lot more likely since that is the platform your target audience spends all their time on.
Even in just the United States itself, you will find differences between the most popular or influential mediums. Different cities tend to have their preferences and unique channels for messaging. This kind of data is valuable and is easily accessible after conducting proper research.
Some questions you could ask yourself are:
- Are buy-one-get-one-free deals more effective in retail stores of certain markets?
- Do people in this new country use email as much?
- Are coupons going to be effective here?
- Is YouTube a better place to advertise, or are TV commercials likely to be more effective?
Ask yourself these questions as you try to figure out what strategy will be best for you.
You must know the sales avenues your customers are using. Try to define where you will be carrying out advertising activities and marketing processes. Along with this, you also have to be at the right place so that the target customers have access to the product or service that you’re offering.
You may also want to ask yourself if selling products online is viable since it has many advantages. Interestingly, people in Europe prefer to shop online. In the United States, where online shopping is a whole other realm in itself.
It can depend on the country to country whether or not you should go online or stay in a brick-and-mortar setup. Many people prefer seeing things in real life before buying them, like fabrics and custom-made things. People might also choose to do things in real life as they are loyal to the shop and want to keep giving their neighborhood store their business.
- Did you know that about 52% of all Montenegrins would buy things in person compared to other countries in Europe?
- On the other side of the spectrum are the United States, United Kingdom, France, and Sweden, ranking the highest in average e-commerce revenue.
Similar to the Best Buy situation, the size and design of your shop should be appropriate if you want to attract the right kinds of customers.
In addition to all the things above, you also have to check and be sure of how much effort you want to put into presenting your product or service. How your product looks matter so much more than you might think. Your packaging will have to vary a lot depending on which market you’re trying to penetrate.
Colour is an important decision when you decide how to package a product. Across the world, different colors could mean a lot of different things.
For instance, red represents happiness, celebration, and joy in a lot of Asian countries. In West Asian countries, however, it means the color of danger, warning, and evil. You definitely want to learn plenty about cultural associations with not just color but even signs and symbols. The psychological impact of color on the brain is also essential when making aesthetic decisions.
You also want to be sure that words are translated and relayed properly in packets and advertising posters. Brands like KFC and Coca-Cola have made mistakes like these.
Some questions you should ask yourself when you design your label are:
Is your brand name important for your product to be unique and distinguishable?
Are your labels, colors, or signs that you are using on your packaging offending your foreign buyers?
If it were a legal requirement, would you be able to produce your labels in the official language? Will you have to provide information about your product’s content? Does the country follow the same unit of measurement as the one on your products?
You need to know your position to determine which all messages will appeal most to your new audiences. Positioning yourself the exact way you want is one of the most critical aspects of entering a new market, especially in a foreign country. If you fail to achieve the position you originally aspired for, repositioning your product/brand differently can incur a huge cost. This is the reason companies do their best to position themselves right the first time around.
A big part of your market positioning reflects in the messages you bring out when you market to people in ad campaigns. You need to decide what your unique value proposition (UVP) is. It should be made up of relevance, value, and differentiation. Your message should be derived from this UVP.
- Relevance means that your product or service should fit in somehow in the lives of your customers.
- Value means the benefits that come with using your products.
- Differentiation means that a customer should select your product instead of choosing another with the same price
It may not seem like it, but you need to get the ambiance and mood right to attract customers, especially in the service industry.
For the most part, services are primarily thought of as intangible in terms of marketing. Meaning, if a product can be changed for the specific needs or requirements of customers in a new market, it is essential for there to be plenty of focus on the physical space where your customers will come to get your services.
There are three key areas for separate areas – Physical environment, ambiance, and spatial layout.
The physical environment is regarding the actual space the consumer will be present when they receive service from you. They experience the space. Therefore, if your business is a restaurant, the physical environment is the ambiance within the restaurant.
Ambiance can be a part of the physical environment. It is all about setting the mood inside the space. Details like lighting, music, and colors could make a big difference with regards to the way customers perceive your establishment
Consider the spatial layout as a karaoke bar. When they are set up in the United States, they are set up in an open space so that everyone can see and hear the performer. In Japan, meanwhile, karaoke bars are set up so that the performer gets a lot more privacy. Groups can book rooms for a specific time limit. Rather than an open space where everyone can see them, the Japanese prefer when their karaoke spaces are private.
According to Nataly Kelly, author of a Harvard Business Review article, not listening to your local team when expanding to the global scale is one of the most common mistakes that you can make. She pointed out that firms and companies were hiring the right people – They’re intelligent, hardworking, innovative, and perfectly capable of doing all required to become a global success.
But it was disappointing to see that despite this, their strategic input and expertise were not considered when strategic decisions were made.
You must understand the importance of your local team and that they are your best bet if you want to succeed in a country outside your home zone. If you feel like you aren’t succeeding in a certain country, your local team will probably have the answer.
You have to ensure that your global marketing strategy is formulated with inputs from your local team and be sure that you’re using them as a helpful resource. They are probably the people who have the best instinct about the new region. So, you should give their opinions a lot of weight and not be afraid to leverage the relationship you have.
Don’t forget that you’re an outsider trying to make inroads into a new country. You want to make sure that your influence on this new community is a positive one. If you want to do well here, you have to keep asking yourself, what does the audience want? And how can I make it happen? Understand the pain points, desires, needs, likes, and what they frown upon.
Try to understand what is most important to them and what they care about. Your aim is to either fill a gap in their life. If there is no such gap, you have to make one and be there to fill it. If you have competitors, ask yourself what you can give the people that your competitors can’t. You will indeed find success if you think about these questions and integrate them into your marketing strategy.
Note that you also want to focus on your company’s long-term survival; you must focus on sustainability and long-term strategy.
You have to ensure that the environment that you’re operating in is set to be prosperous in the long run. Especially when you’re introducing yourself to a new market in a country you haven’t yet established yourself in.
Three Main Ps
The critical way to strategize an international marketing business plan is to utilize the three main Ps – planet, people, and profit. With these three in your kitty, you will have a lot more success as an international brand.
You should always be on the lookout for long-term solutions that appreciate over time, not just bandaids to put over bullet wounds. Your own business will ultimately be strengthened if you aid in creating sustainable communities that can stand the test of time.
The Bank of America has done a lot of work to strengthen communities from low-income areas. They started several non-profit alliances and collaborations and helped people improve their financial literacy. This, in turn, has led to a much more sustainable climate where a business can grow and thrive.
Not just your community but even your business will be a much better part of the world if you put the three Ps first. Your employees will thrive, and that will further increase your reputation. As per a study, more and more people (2/3 Millenials and 60% GenZs) want to work for businesses that make an effort to give back to society. Don’t forget to ask yourself how your business will benefit the people of the country you are going to expand to. Every company should incorporate volunteering and charity into their marketing strategy and their main business strategy.
Global Marketing Mix
A well-thought-out global marketing strategy allows companies to tailor products to specific markets while utilizing the most effective promotional channels to reach customers.
Marketing strategies similar to those that lead to domestic marketing success may also be used in international marketing. The gap between marketing within an organization’s home nation and marketing in overseas markets is fast dissolving due to the constantly expanding force of globalization. While keeping this in mind, businesses are adapting their marketing tactics to match the demands of the global marketplace while also attempting to maintain competitiveness in their domestic markets.
As a result of these developments, businesses are now customizing their worldwide marketing mix for diverse regions, depending on local languages, requirements, wants, and values.
As mentioned earlier, the four Ps of marketing—price, placement, price, and promotion—are all factors that are affected when a company transitions through different phases while on its way to becoming a global company that exists in several other companies.
Mix for Global Marketing: Product + Promotion
The interaction between product and promotion is significant for multinational companies (MNCs) because it allows a business to make minimal changes to its product or service and its marketing strategy rather than completely overhauling the product and promotion for multiple markets. Coca-Cola is an excellent illustration of this idea in action. For all markets, the beverage company uses two main formulae (one that has sugar, while the other has corn syrup). Coca-contour Cola’s bottle design and characteristic ribbon are used in some form on the product’s packaging in every region.
However, the bottle can feature the nation’s original language and be the same size as other bottles or cans that contain beverages on the market in that country. Before initiating promotional activities, global enterprises need to define their target markets. And then decide which items will connect best with customers and businesses.
As they discover more about the target country and its market’s receptivity to the products and services they offer, research can assist marketing professionals in deciding which path is best —the localization strategy or the standardization strategy.
Aside from determining which all prices and distribution methods would serve the country’s markets to their fullest, global marketers must also determine if and how they will use social media – whether or not they should use Facebook, YouTube, or Instagram to advertise.
Global marketers’ task is to produce and position promotional activities in environments where local target customers are likely to be most open to receiving and taking action according to the messages. Each target market’s media habits and tastes vary, and knowing these differences is critical for choosing the correct promotional mix.
Promotion is usually the greatest line item in a multinational company’s marketing expenditure, after product research, creation and development. Because messages across many channels reinforce and amplify one another, integrated marketing communications may dramatically boost efficiency and save promotional costs.
Promotion is a critical component of the mix that gives a global corporation the ability to transmit the same message everywhere. It utilizes techniques that are engaging, cost-effective, and relevant approaches for organizations that follow a uniform strategy to marketing products and establishing brands.
While a standardized worldwide promotion plan allows global businesses to participate in identical marketing tactics and promote a more consistent image and brand, it is also essential for marketers to adapt to variations in consumer response to marketing mix parts. Marketers should also fight against a wide range of local and worldwide competitors, making full use of promotional methods and product development.
Mix for Global Marketing: Promotion
Before going global, a company must consider social, cultural, political, economic, and other factors that will be changed or will change the company. Creating a global marketing strategy is a challenging endeavor. It is tough for a corporation to deliver the same message to international markets in a single voice unless it has the same competitive position in all countries. Most multinational organizations must be open to some amount of localization and flexible enough to respond to changing local market trends, tastes, and demands, which is rarely the case.
When creating a global advertising plan, a marketer looking forward to the world stage must balance four corporate objectives, potentially opposing each other:
1) Establishing a company that speaks in a single voice
2) Establishing economies of scale in the creative process
3) Enhancing local advertising effectiveness
4) Boosting the company’s speed of implementation
When it comes to executing worldwide promotional activities, global marketers have three options: exporting executions, developing local executions, and importing concepts.
To successfully implement these approaches, marketers must ensure that their promotional campaigns consider how internal conditions shape consumer behavior (e.g., demographics, knowledge, attitude, beliefs) and external influences (e.g., culture, ethnicity, family, lifestyle) in local markets.
Marketers must ensure that their promotional campaigns take into account how internal conditions (like knowledge, demographics, beliefs, attitude) and external influences like ethnicity, gender, lifestyle, and family) shape consumer behavior in a local market so that they can successfully implement these approaches. Attention should be paid to the following areas:
- Language distinctions are critical in worldwide marketing. The earth is home to almost 3,000 languages. Marketers have had a lot of trouble devising advertising campaigns and product labeling because of language variations.
- Even words with the same meaning exist in nations that speak the same language. Consider the phrases “flat” (apartment in American English). “Pants” (underwear in American English). “Lift” in British English (elevator in US English). If marketing messaging and resources do not reflect the local accent and use, they can quickly go awry. When a country’s population speaks many languages, language becomes even more critical. Literacy rates are another factor to consider for marketers. Literacy may be a big concern depending on the intended audience and market. Some nations, mainly developing ones, continue to have low literacy rates, such as Afghanistan, which has only 38%.
Varied civilizations have different meanings for different colors. This is why you have to emphasize the significance of thoroughly evaluating packaging and other aesthetic components aimed at a worldwide audience. Green, for example, is a holy hue in the Muslim religion. It is not used for packaging or branding in Middle Eastern nations. Black and white are colors for mourning in Japan and must not appear on product packaging. In various Hispanic countries, purple relates to death and can represent something eerie and spooky.
A person’s values are formed by their education, moral or religious convictions, life experiences, and upbringing. Several Americans, for example, value material possessions, money, and wealth far more than other people. They are a lot more prone to acquire status symbols as compared to people from different countries.
In other parts of the world, in China, for instance, the people place a strong value on honor, dignity, and pride. They are a lot more likely to pay much larger sums of money to “save face.”
If given a choice to restore their honor and reputation, they are more likely to forgo a large sum of money that they believe is an adequate amount to maintain their honor.
Business etiquette differs from one country to another. They are sometimes the complete polar opposite. In France, for example, wholesalers don’t prefer promoting items. They are usually just primarily concerned with supplying shops with the required goods since it is not exactly a business-to-customer operation.
Religious Faith, Festivals, And Holidays
A person’s religious views might also greatly influence their buying behaviors and things that they purchase, in addition to their values. The Christmas holiday season is a crucial sales time in the United States and other countries with a large Christian majority. The Chinese New Year brings out the shopping in China. In India, a series of Hindu holidays, such as Dussehra, Durga Puja, and Diwali, kick off a multi-month holiday season.
You should also consider other factors like a country’s political or judicial environment, the status of the economy, technology, poverty, and socio-cultural understanding when formulating the global marketing mix in a new country.
The company should monitor the dynamics of a target audience. It is important to respond quickly so that your brand can adapt to the preferences, likes, and dislikes of your new country.
How To Adjust Your Global Marketing Promotional Mix
Worldwide firms evaluate promotional concepts utilizing marketing research tools that produce findings that are similar across nations when they launch advertisements, public relations campaigns, or sales initiatives for the global scenario. Because they disclose which message or creative components contribute to a product’s success in the market, these systems aid marketers in achieving economies of scale in marketing communications.
According to a marketing study, nonverbal variables, including attention flow, and moments that are started for branding and flow of emotion, can give more tips and suggestions for what works in an advertising or other marketing communication piece across many nations and languages.
In both local and international situations, the same guidelines for researching and understanding a target market apply. Marketers absolutely must do marketing research to have a more comprehensive and complete knowledge of effective promotional strategies for a location.
Trial and error, as well as informed experimentation, are excellent instructors. Marketers and brand managers may leverage what they’ve learned about what works (and what doesn’t) in the promotional mix to infuse innovative ideas into other marketplaces. Companies may also utilize this data to tweak certain aspects of their promotional mix that generate a low or negative reaction from worldwide audiences worldwide from different countries.
Mix For Global Marketing Strategy: Price
When considering a global marketing mix, product, promotions, and placement have to be decided with the pricing you are going for. Determining what a corporation will receive in return for its products is referred to as pricing. Many aspects of price in international marketing are comparable to that aspect when considered for domestic marketing.
Marketers should keep the following aims in mind when they build pricing strategies:
- Meeting the company’s financial objectives and producing earnings
- Aligning with market realities and consumer purchasing tendencies
- Assisting a product’s specified positioning by ensuring that it is consistent with other aspects of the marketing mix, such as product, promotion, and location.
Manufacturing costs, distribution routes, marketplace, competition, market circumstances, and product quality all play a role in pricing in the global marketing mix, just as they do in domestic marketing. Prices are likely to be higher if the distribution is restricted to a single channel partner. The high expenses of production, shipping, intensive advertising, and promotional efforts necessitate high prices. If production costs rise due to a rise in the price of raw materials, prices must also rise.
What To Consider When Pricing For The Global Market
The prices of many articles depend on the price of oil. Rising oil prices increase the cost of transportation.
When discussing issues that impact global commerce worldwide, pricing concerns become more difficult and complex in the global scenario. Multinational corporations must deal with a variety of currencies, interest rates, and exchange rates.
In a scenario when the US dollar is much stronger than a currency from another country, imported goods from America, for example, are more costly than local rivals, resulting in a drop in sales at the local level. When the situation changes and the dollar’s value falls below that of the currency from another country, goods imports become more expensive. The end product is forced to be more expensive to pay production expenses.
Take, for example, if a country where a minimum wage law is applicable. The company will have to pay a lot more to the people who work there. In a case such as this, the product’s price will be counted in the cost of the employee’s increased wages.
Meanwhile, the price of natural resources (eg. oil, etc) is likely to increase and decrease based on government regulation. It will definitely affect the final selling price of the good.
When formulating a pricing strategy, you will also have to consider the government’s rules and regulations. Important details that should be accounted for are international trade and business tariffs and costs incurred. Maintain a certain level of compliance with the government regulatory body. It goes a long way in deciding the price that needs to be set for the product or service. Adherence to legal criteria of jurisdictions in certain areas and administrative regulations may also play a part.
You should also consider other regional issues that could greatly impact the price. When marketing globally, a customer’s willingness to pay a certain amount for certain items and brands may have a lot to do with cultural expectations and associations.
You can only ultimately decide the final profit by its placement against other products in the same category. You must see how your regional competitors are doing and set the price accordingly. If the price is set too high, you could risk not making any sales. But if it is too low, your brand image might take a beating. As per cultural norms, global marketers must carefully evaluate how to place their products or services. They should determine if their items are regarded as high-end, low-cost, or somewhere in between.
Things To Consider When Determining The Place/Distribution For The Global Market
Placement determines what all channels a company uses to distribute a product across multiple countries around the world. They also look into aspects like competition and how similar brands position themselves in the target market. A worldwide brand must alter its marketing plans for that country to account for important aspects like placement and distribution when formulating the marketing mix. This should be done regardless of the size or exposure of the company and the country.
Many global brands also try to arrange the items they are trying to sell in supermarkets to be most responsive to their messages and want to buy the product or service.
Global marketing involves several more steps than when you’re marketing in a domestic or local space. Especially in distribution, there are several more steps. Because of this, most businesses that compete in the foreign marketplace have to do a significant amount of research. If they don’t, it is unlikely that they will identify the market precisely and understand the distribution channel accurately. They also do this for the contexts in which customers will locate, acquire, and utilize the product.
The transportation and economic infrastructure of a country, its customs, market circumstances, and the competitive environment may all influence distribution strategy. For example, vending machines are not used to distribute beverages in every cultural environment. A lot of countries don’t have vending machines at all, unlike in the United States.
We hope this article provided you with the answer to what are the principles of international marketing? It is essential to consider the product’s positioning in a foreign marketplace. For a luxury brand functioning internationally, it might not be ideal for distributing its products in the United States through a retailer that bargains. On the other side, an affordable shoe company might not get the attention of buyers in an Italian boutique.
People who market globally must also think about how they plan to disseminate and make their product seen by the target audience. This should be done throughout shopping venues across the world that are specific to each region or market.
Finding the right placement in a domestic or international market can give a company a major competitive advantage and substantial perks. If they tailor their placement methods for national and local markets in another country while maintaining a brand image, the company will portray itself as a strong and consistent one and will truly last the test of time.
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You might also enjoy these popular International Expansion related articles What Is Market Penetration Growth Strategy?, Think Global, Act Local and What To Consider When Expanding A Business Internationally on a similar topic.
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